Tag: 2019 News

Reuters reports that Johnson & Johnson will pay $20.4 million to settle claims by two Ohio counties, allowing the U.S. healthcare giant to avoid an upcoming federal trial seeking to hold the industry responsible for the nation’s opioid epidemic.

J&J became the fourth drugmaker to settle claims ahead of the Federal Court trial against multiple manufacturers and distributors in Cleveland scheduled for later this month. The case is considered a bellwether for more than 2,600 lawsuits by state and local governments that are pending nationally.

“The settlement allows the company to avoid the resource demands and uncertainty of a trial as it continues to seek meaningful progress in addressing the nation’s opioid crisis,” J&J said in a statement.  “The company recognizes the opioid crisis is a complex public health challenge and is working collaboratively to help communities and people in need,” it added.

J&J which formerly marketed the painkillers Duragesic and Nucynta, said the settlement includes no admission of liability.

The company will pay $10 million to Cuyahoga and Summit counties, reimburse $5 million of their legal and other expenses and provide $5.4 million to non-profit organizations that run opioid-related programs in the counties.

Mallinckrodt Plc finalized a $24 million settlement with the same two counties on Monday. Endo International Plc and Allergan Plc also settled with the two counties in August to avoid going to trial.

The remaining defendants in the Oct. 21 federal trial include McKesson Corp, AmerisourceBergen, Cardinal Health, Teva Pharmaceutical Industries Ltd, Walgreens Boots Alliance Inc and Henry Schein Inc.

OxyContin maker Purdue Pharma LP succumbed to pressure from the lawsuits and filed for bankruptcy protection in September.

Earlier in the year, an Oklahoma judge ordered Johnson & Johnson to pay $572.1 million to the state for its part in fueling an opioid epidemic by deceptively marketing addictive painkillers.

Purdue Pharma and Teva had settled claims by Oklahoma’s attorney general for $270 million and $85 million, respectively.

Gov. Gavin Newsom signed Senate Bill 542. The new law creates a rebuttable presumption that a first responders PTSD struggles are an occupational injury, The new law would apply to injuries occurring on or after January 1, 2020.

The rebuttable presumptions for first responder work-related injuries already included physical ailments such as heart disease, cancer and hernias.

Before Newsom signed SB 542, California’s law limited psychiatric injury compensation to those that could prove the injury was at least 50 percent related to their job.

Section 3212.15 is added to the Labor Code. Under these new provisions, in the case of certain state and local firefighting personnel and peace officers, the term “injury” also includes post-traumatic stress that develops or manifests itself during a period in which the injured person is in the service of the department or unit.  And the law would prohibit compensation from being paid for a claim of injury unless the member has performed services for the department or unit for at least 6 months, unless the injury is caused by a sudden and extraordinary employment condition. The six months of employment need not be continuous.

The injury so developing or manifesting itself in these cases shall be presumed to arise out of and in the course of the employment. This presumption is disputable and may be controverted by other evidence.

This presumption shall be extended to a member following termination of service for a period of 3 calendar months for each full year of the requisite service, but not to exceed 60 months in any circumstance, commencing with the last date actually worked in the specified capacity.

Newsom signed the law alongside two other bills that will provide mental health support to firefighters and peace officers. The second new law establishes standards for peer support programs. The third signing prohibits the outsourcing of local emergency dispatch services to for-profit agencies.

AB 1116, the California Firefighter Peer Support and Crisis Referral Services Act by Assemblymember Tim Grayson (D-Concord), establishes statewide standards for first responder peer support programs to provide an agency-wide network of peer representatives available to aid fellow employees on emotional or professional issues.

SB 438 by Senator Robert Hertzberg (D-Van Nuys) will prohibit a public agency from outsourcing its local emergency dispatch services to a private, for-profit entity – except when pursuant to a joint powers or cooperative agreement. It also clarifies that a public safety agency maintains the authority to determine the appropriate deployment of emergency resources within the agency’s jurisdiction in order to provide the highest and best level of emergency response for the community it serves.

Victoria Enriquez sustained industrial injury to her psyche while employed during a cumulative period ending November 30, 2004 by County of Santa Barbara.

A 2014 Opinion and Decision After Reconsideration found permanent disability of 60 percent, based on an AME who reported that applicant was unable to compete in the open labor market.. However, the AME apportioned 40 percent of applicant’s permanent disability to other factors reducing her disability to 60 percent.

After the issuance of the Decision After Reconsideration of July 18, 2014, Enriquez sought SIBTF benefits.

After submission of the SIBTF case in 2016, the WCJ issued an Order Vacating Submission and Ordering Further Discovery. “Specifically/’ wrote the WCJ in his Order, “the parties are to elicit an opinion from the AME, Dr. Plesons, whether Applicant had a preexisting labor disabling permanent disability, prior to the industrial injury.” At an August 2016 hearing, it was noted that “SIBTF will write letter to doctor.”

Nevertheless, despite the fact that the WCJ found that further development of the record was necessary, the fact that defendant was designated to contact Dr. Plesons, and the fact that applicant carries the burden of proof on the issue, no further evidence was procured or admitted into the record.

Ultimately the WCJ rendered a decision on an evidentiary record he had previously found to be inadequate. The SIBTF Petition for Reconsideration was granted, and the Findings of Fact and Order was rescinded in the panel decision of Enriquez v County of Santa Barbara.

On April 19, 2004, SB 899 went into effect. SB 899 contained far-reaching amendments to the California workers’ compensation system. Among these changes, former Labor Code sections 4663 and 4750 were repealed, and a new Labor Code section 4663 was enacted to now provide that “Apportionment of permanent disability shall be based on causation.”

Although SB 899 repealed the old apportionment statutes, Labor Code section 4751 governing SIBTF liability remained unaltered. Thus, even after SB 899, in order to qualify for SIBTF benefits, the employee must show that his or her disability was labor disabling prior to the subsequent industrial injury. (Escobedo v. Marshalls (2005) 70 Cal.Comp.Cases 604, 619 (Appeals Board en banc).) “Accordingly, if an applicant’s non-industrial pathology causes apportionable permanent disability . . . then [SIBTF] benefits will not be payable under section 4751 unless the applicant demonstrates that the pathology was causing permanent disability prior to the subsequent industrial injury.”

The requirement for the existence of a prior “labor disabling” permanent disability under section 4751 is the same requirement that existed for apportionment of permanent disability under Labor Code section 4750 prior to the enactment of Senate Bill 899 (SB 899), effective April 19, 2004.

The finding that applicant had 40 percent disability apportionable to other factors pursuant to current Labor Code section 4663 “is in no way tantamount to a finding that applicant had 40 percent (or any) labor disabling permanent disability at the time of her industrial injury.” The WCJ must make a finding supported by substantial medical evidence that, at the time of the industrial injury, applicant had a labor disabling permanent disability.

New California Workers’ Compensation Institute research shows the number of California workers’ compensation inpatient hospital stays fell nearly 31 percent from 2010 through 2018, fueled in large part by a steady decline in spinal fusions.

The study, authored by CWCI Senior Research Associate Stacy Jones, uses hospital discharge data from nearly 32.3 million inpatient stays compiled by the state Office of Statewide Health Planning and Development (OSHPD) to measure and compare the volume and types of California inpatient hospitalizations paid under workers’ compensation to those paid by Medicare, Medi-Cal and private coverage.

Workers’ compensation is the smallest of the 4 medical delivery systems reviewed, accounting for just 0.4 percent of all inpatient stays in 2018, which is down from 0.6% in 2010, primarily due to a surge in Medi-Cal hospitalizations after 3.7 million adult Californians were added to the Medi-Cal rolls after Affordable Care Act plans became available in 2014.

At the same time, a number of factors spurred a decline in workers’ comp inpatient stays from 2010 to 2018, including:

— Fluctuations in the number and types of claims;
— Increased use of ambulatory surgery centers;
— The adoption of utilization review and independent medical review programs requiring that treatment meet evidence-based medicine standards;
— Technological and procedural advances that allow more services to be provided in outpatient settings; and
— A 45.9 percent reduction in the number of spinal fusions since 2010, though fusions are still the top inpatient service rendered in workers’ comp, representing more than 1 in 6 injured worker hospitalizations last year.

In addition to tracking inpatient trends for California workers’ compensation, Medicare, Medi-Cal and private plans over the 9-year span of the study, other analyses and exhibits in the report provide detailed data showing:

— The breakdown of workers’ comp inpatient stays among the top 5 Major Diagnostic Categories (MDCs);
— The proportion of surgical vs. “medical” (non-surgical) hospitalizations in each of the 4 payer groups;
— The top 5 workers’ comp surgical and medical inpatient discharges by diagnostic-related group (MS-DRG);
— The breakdown of the top 10 workers’ comp MS-DRGs across payer groups in 2018;
— The volume and prevalence of spinal fusion surgeries by payer group from 2010 through 2018;
— The top 10 hospitals based on the percentage of their inpatient discharges covered by workers’ comp, and the proportion of California workers’ comp medical and surgical hospitalizations rendered at those facilities.

CWCI has released its study as a Research Update report, “California Workers’ Compensation Inpatient Hospital Trends, 2010-2018.” Institute members and subscribers can access the report in the Research section at www.cwci.org and others can purchase it from the Institute’s online Store.

The Department of Justice announced that Avanir Pharmaceuticals, a pharmaceutical manufacturer based in Aliso Viejo, California, was charged for paying kickbacks to a physician to induce prescriptions of its drug Nuedexta.

The Northern District of Ohio also announced indictments of four individuals, including former Avanir employees and one of the top prescribers of Nuedexta in the country, who were involved in the kickback scheme.

Avanir has also agreed to pay over $95 million to resolve civil False Claims Act allegations of kickbacks as well as its false and misleading marketing of Nuedexta to providers in long term care facilities to induce them to prescribe it for behaviors commonly associated with dementia patients, which is not an approved use of the drug.

In addition to the $95,972,017 being paid to resolve the United States’ civil claims, Avanir will pay an additional $7,027,983 to resolve state Medicaid claims.

Prosecutors alleged Avanir violated the Anti-Kickback Statute by paying a doctor to induce him to become a high prescriber of Nuedexta to beneficiaries of federal healthcare programs, offering him financial incentives to write additional Nuedexta prescriptions for beneficiaries of federal healthcare programs, and inducing him to recommend that other physicians prescribe Nuedexta to beneficiaries of federal healthcare programs.

Nuedexta is approved by the Food and Drug Administration for the treatment of pseudobulbar affect (PBA), which is characterized by involuntary, sudden, and frequent episodes of laughing or crying, and occurs secondary to a neurologic disease or brain injury.

The Northern District of Georgia also announced a deferred prosecution agreement resolving the charge, under which Avanir admits that it paid the doctor to induce him to not only maintain, but increase his prescription volume. Under the agreement’s terms, Avanir will pay a monetary penalty in the amount of $7,800,000, and a forfeiture in the amount of $5,074,895. The United States will defer prosecuting Avanir for a period of three years to allow the company to comply with the agreement’s terms. The agreement will not be final until accepted by the court.

Named in the 83-count indictment are: Deepak Raheja, 63, of Hudson; Gregory Hayslette, 43, of Aurora; Frank Mazzucco, 41, of Dublin, and Bhupinder Sawhny, 70, of Gates Mills. All four are charged with conspiracy to solicit, receive, offer and pay health care kickbacks. Avanir has agreed to cooperate in the prosecution of these individuals.

The civil settlement resolves lawsuits filed by former employees of Avanir, under the qui tam or whistleblower provisions of the False Claims Act. Kevin Manieri will receive $12,389,823 of the civil settlement, and Duane Arnold and Mark Shipman will receive $5,365,000 of the civil settlement.